Your Legislative Update

On May 15, 2020 you received a Legislative Alert describing the dramatic negative impact SB 939 would have on the commercial real estate industry, and the need to oppose the bill. While the bill was amended, all of the concerns that were noted on May 15 remain, as follows:

Enables tenants to not pay rent during the State of Emergency, which has no end date, and then have up to an additional 12 months to pay the accrued rent, so you may not get any rent for years.

Provides tenants with legislated lease termination rights which are not part of their current lease agreement. Further, the termination rights apply to lease guarantors as well.

In short, SB 939 negates the terms and conditions of all current commercial leases to the benefit of one business (the tenant’s) at the expense of another business (the landlord’s).

As expected, SB 939 was passed by the Senate Judiciary Committee. Yet, it was also clear that the efforts to oppose the bill did have an impact, and our opposition needs to continue in a vigorous manner. The bill only garnered the minimal amount of support needed to move it forward. The signal from the Committee members was strong that there are numerous issues that still must be addressed even with the latest amendments.

Since the bill will continue to move forward and is expected to reach the Senate Floor no later than June 26 for a vote, it is important that you continue to learn about SB 939, and get involved in opposing the bill. Click here for a copy of the full Senate staff analysis of the bill which includes the bill itself.

There will be ongoing discussions in Sacramento with the authors of the bill, Senators Wiener and Gonzalez. This means they need to continue to hear from more NAIOP members that you oppose the bill. We have only gotten through the first round, and the pressure needs to remain constant. So, if you have not yet done so, please send letters opposing the bill to the co-authors as indicated below.

Click here for an updated sample letter in a Word document for you to put your letterhead on, sign and email to: Miles.Horton@sen.ca.gov (legislative aide to Senator Wiener) and Cynthia.Alvarez@sen.ca.gov (legislative aide to Senator Gonzalez), with a cc to rhime@cbpa.com It is important to have the letters personalized with your letterhead and signature so they see the depth of opposition to this bill.

As SB 939 moves forward toward the Senate floor, the opposition campaign will begin its outreach to every State Senator, and it’s important that contacts be made with your individual local State Senator. Arrangements have been made with NAIOP Corporate to send to all NAIOP members statewide a sample letter to send to your local State Senator. It will have easy directions on how to quickly send the letter and the proper email address to use. This will come to you at the appropriate strategic time as determined by our Sacramento advocate, CBPA. So, please keep your eye out for the email from NAIOP Corporate over the next several weeks.

Additionally, if you or someone in your company knows your local Senator, please contact Peter Herzog at peter@talleyassoc.com to discuss potential additional contacts with your Senator(s). If you don’t know who your State Senator is, please visit http://findyourrep.legislature.ca.gov/ and find out now – we’ll be asking for your help as the bill continues its journey to the Senate floor.

This is a bill that we all need to oppose to protect our industry. Thank you.